INVESTIGATION: Abuja electricity boss’ N36million monthly pay, others tear apart firm
by Premium Times
A major labour crisis is unfolding at the Abuja Electricity Distribution Company over an alleged fraudulent allocation of outrageous salaries and perks to a few officials.
While a privileged few draw as high as N36 million a month from the public liability company that is operating on deficit, majority of equally qualified and even more critical staff absorbed from the previous government-owned Power Holding Company of Nigeria, PHCN, receive peanut, PREMIUM TIMES has found.
After the privatisation of PHCN, the Nigerian government retained substantial stake in the distribution companies, including the Abuja DISCO.
This means the government is entitled to part of the profit. But this must happen only after the operation cost of the company, comprising overhead and personnel cost, are deducted.
For the past two years, the company recorded only losses instead, but at the same time paid outrageous salaries to a select few.
The highest paid director takes home N36 million a month, while a staff with Ordinary National Diploma, OND, takes home as high as N1.9 million monthly.
While this select few earn jumbo perks, majority of the key staff retained from PHCN are paid peanuts – between N50, 000 to N150, 000.
According to the company’s financial statement prepared by KPMG, as at December 31, 2014, the Abuja Electricity Distribution Company’s revenue increased from N36.01 billion in 2013 to N48.1 billion.
Yet, the company declared a higher loss of N25.61 billion in 2014, up from N13.37 billion in 2013.
Notwithstanding the loss, the company’s administrative expenditure nearly doubled – from N13.67 billion in 2013 to N24.93 billion in 2014.
The highest paid director in the company (believed to be the Managing Director), who received N5.67 million as salary monthly in 2013, had his pay reviewed by over 640.7 percent, to N36.33million, according to the report obtained by PREMIUM TIMES.
Six directors who received between N3.5million and N4million a month in 2013 also got a raise to between N145 million and N150 million annual pay.
Within the year, N719.7million was also spent on “salaries and other short-term benefits to key management personnel compensation”.
Whiff of fraud
After the privatization of PHCN, about 3,601 former workers of the defunct company were re-engaged on November 1, 2013, by the new firm. The workers were retained mostly as casual staff.
The Abuja distribution company recruited another set of employees in 2014, either as permanent or contract staff.
Although the company’s approved salary structure obtained by PREMIUM TIMES ranged between N47, 186.80 for the least paid staff on grade level JS1 step 1, and N1.137.069.17 for the highest paid official on grade level EG1, some categories of staff received far ahead of those allocations.
The payroll reflects a huge disparity in favour of the new employees.
Although some of the new employees lack technical competence and practical experience, they were made to pocket between N1.2 million and N1.9 million per month, PREMIUM TIMES found.
Their colleagues from PHCN receive between N50, 000 and N200, 000 per month, irrespective of qualification and experience.
Only a few of the older workers earn N200, 000 and above.
The huge disparity in salary between the different categories of workers is fuelling discontent in the company.
Public or private firm?
Abuja Electricity Distribution Company is one of the 11 successor power distribution companies (DISCOs) of PHCN.
It was created to undertake electricity distribution activities and related business in Niger, Kogi and Nasarawa states and the Federal Capital Territory.
The company is owned 60 percent by KANN Utility Company Limited, a joint venture between Xerxes Global Investment Ltd, CEC Africa Investment Ltd and Abuja Electricity Distribution Plc.
The Nigerian Government controls 40 percent of the company through the Bureau of Public Enterprises, which has 32 percent, and the Ministry of Finance which owns eight percent.
Prior to the power sector privatization exercise, BPE had disengaged over 4,000 former PHCN employees on October 31, 2013, as part of the winding down process.
The Nigerian Electricity Regulatory Commission, the electricity sector regulatory agency, said AEDC was later allowed to re-engage about 3,601 of the workers for an initial contract period of six months.
Details of the company’s financial statement showed that at the completion of the re-engagement process, 3,658 workers were on the company’s payroll in 2013, consisting Administration (845), Finance (399), Marketing (1,116) and Technical (1,298).
The figure, however, fell to about 2,243 in 2014, with Administration having 320, Finance (279), Marketing (859) and Technical (785).
At the expiration of the initial contract period in 2014, NERC explained that each worker was issued fresh re-engagement letters as
permanent or contract staff, in line with the AEDC’s framework of employee remuneration and public service rules.
There were yet a lot of others designated casual workers.
“Apart from discriminatory salaries, the casual workers are denied vacation and proper medical attention, despite performing similar jobs and exposed to same hazardous conditions at work on a daily basis,” one of the affected workers said. He did not wish to be identified for fear of victimization.
Consulting house of fraud
Investigations by PREMIUM TIMES uncovered monumental fraud in the company’s payroll traceable to an agency, TBS Consulting, hired to handle staff recruitment in 2014.
TBS consulting was hired by the Executive Director, Human Resources and Corporate Affairs, Tolulope Mark-Ojie. The Independent Corrupt Practices and other Related Offences Commission is investigating whether Ms. Mark-Ojie has more than a passing interest in TBS Consulting as alleged by some company insiders.
Insiders wondered why Ms. Mark-Ojie would hire Yusuf Mosunmola, one of the directors and a key member of the TBS Consulting management team, as Head, Organisational Development & Learning for AEDC, and then allow her to continue to function simultaneously in both positions.
As director of the consulting firm, Ms. Mosunmola was in charge of the entire recruitment process for all categories of employees in AEDC.
The Executive Director, Corporate Planning & Business Development, Omokhoa Okaisabor, told PREMIUM TIMES that Ms. Mosunmola was hired to help resolve the human resources issue the company had at inception.
After the privatisation exercise, AEDC was confronted with human resources issues that bordered on lack of proper training for staff and a lot of skill gaps, he said.
Mr. Okaisabor said the company then resolved that if no one was found within the company to handle the human resource function, it should be outsourced to a contracting firm, to bring the required staff to manage the key HR function on contract basis.
“That was how TBS Consulting was hired, with Ms. Mosunmola as one of its leaders, to recruit the staff on contract basis,” Mr. Okaisabor explained.
The director explained to PREMIUM TIMES that all the contract staff recruited by TBS Consulting for AEDC had “special arrangements” with Ms. Mark-Ojie on how the salary penned against their names would be split.
“Not all the salary actually gets into their (contract staff’s) pockets,” Mr. Okaisabor explained. “The contracting firm has some personal arrangement to get part of the money paid to them as salaries by the company. The practice is that the contracting firm gets the money from the company and pays the staff.”
“Most of the names found on the company’s payroll are either non-existent or belong to persons who work directly for Madam’s (Ms. Mark-Ojie) other companies,” one of the staff familiar with the issue said on Friday.
The staff said the special arrangement must have been in connection with allegations that at least 60 percent of the salaries credited to most of the high earners on the company’s payroll every month goes to Ms. Mark-Ojie.
Some of the names on the AEDC payroll that raised eyebrows were those of two contract staff hired in 2014 and posted to the Lokoja District office.
They include Akanku Olusegun, a National Diploma holder in Electrical, and Higher National Diploma (HND) (in view), who is paid N823, 764 per month.
The same goes for Adesulu Adebayo, another National Diploma holder in Electrical holder in the same office, who takes home N764, 097.60 salary every month.
Curiously, several of their colleagues in various district offices with either similar qualifications or superior university degrees of many years’ standing, are paid a paltry N50, 000.
Ms. Mosunmola, brought in from TBS Consulting, remains one of the highest paid officials, who pockets a whopping N1.84 million pay every month. This is in addition to the N27million and another N10 million paid to her as furniture allowance and accommodation respectively.
Also Ms. Mosunmola grapples with the obvious challenge of conflict of interests as she appears to work for AEDC and TBS Consulting simultaneously.
“It’s a clear case of fraud inspired by greed,” Alfred Ituah, an Abuja-based legal practitioner told PREMIUM TIMES on Friday.
“It is practically impossible for her (Mosunmola) to expect that she would effectively joggle both jobs of recruiting workers for AEDC and be on the company’s staff payroll in whatever capacity without getting entangled in the mess of conflict of interest,” he noted.
ICPC wades in
In August, some top AEDC officials were invited by the Independent Corrupt Practices and Other Related Offences Commission for questioning following a petition by some aggrieved workers.